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June 2012
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IDEOLOGUE Obama may nix Keystone despite political calculus

As political issues go, opposing the Keystone XL pipeline project has become a loser for Democrats. And from an environmental standpoint, there are more negatives to not building the pipeline than building it, but rationality has never really been a hallmark of the American environmental movement.

The long-delayed pipeline popped back into the national spotlight last week when a lengthy U.S. State Department review - as only government can do, the analysis was 11 volumes thick - concluded that building the proposed pipeline between Canada and refineries in Texas would not have a material impact on development of Canadian tar sands and related pollution.

Environmentalists (our president among them) see oil extracted from Canadian tar sands as an evil. They contend that both extracting and refining it consume more energy than traditional petroleum sources and thus contribute disproportionately to global warming. President Obama has strongly suggested in the past that a State Department finding that the pipeline would materially increase development of the tar sands and related pollution would lead him to block it.

But the report out last week concluded that the pipeline would have no material effect on either the pace or the extent to which Canada will develop its resource. The study concluded the sands would be developed anyway and would most likely be shipped to U.S. refineries by rail in the absence of the pipeline.

A Wall Street Journal story last weekend says that in fact is already happening. The pipeline has now been delayed more than five years, and the newspaper says many Canadian exporters got tired of waiting for it. Exports of Canadian crude to the U.S. were up 5 percent last year, to 2.6 million barrels a day. Keystone would move 830,000 barrels of Canadian crude per day. Presently, the bulk of Canadian shipments are coming by rail - a less energy efficient and more perilous method of transporting crude. Exxon Mobil Corp. expects to complete a new railway-loading facility early next year in Edmonton, Alberta to ship more of the Canadian "heavy crude" by that mode.

Meanwhile the political battle has split the Democratic Party and some of its key constituencies. Labor unions and industry have joined forces in support of the project, which they see creating thousands of well-paying jobs during the construction phase and substantial numbers of direct and indirect jobs down the road.

Several Senate Democrats facing tough re-election bids this November, including Sen. Mary Landrieu of Louisiana and Mark Begich of Alaska are urging President Obama to approve the pipeline, and have suggested they may file legislation to try to force his hand if action is not forthcoming soon.

Given those pleas, and polls showing the very real prospect that Republicans will seize control of the Senate in November by unseating the likes of Landrieu and Begich, one would think this would be any easy decision for the president. But that's no given. The president's relations with his own partisans in Congress have become increasingly chilled of late - evidence Senate Majority Leader Harry Reid's decision last week to oppose two "fast track" trade agreements the president cited as an important part of his economic agenda in his State of the Union speech just days before.

And even though the final decision on Keystone technically belongs to Secretary of State John Kerry, The Wall Street Journal reports the president says he, not Kerry, will ultimately decide the issue. It wouldn't surprise us to see the president - against all political and scientific reason, ax the project in the name of ideological purity and let his endangered congressional colleagues twist in the wind.

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